Natural Resources Committee on May 28th, 2026

[The Vice-Chair, Conservative, Shannon Stubbs]

Colleagues, I call this meeting to order.

Thank you to all the witnesses who are joining us today.

I want to acknowledge that we are meeting on the unceded territory of the Algonquin Anishinabe nation.

Welcome to meeting number 39 of the House of Commons Standing Committee on Natural Resources. This meeting is taking place in a hybrid format, so I need to remind participants of the following points.

Before you speak, please wait until I recognize you.

For colleagues here, I realize how hypocritical that is of me to say.

[Voices]

Oh, oh!

[The Vice-Chair, Conservative, Shannon Stubbs]

Anyway, moving on, for those participating by video conference, click on the microphone icon to activate your mic. Please mute yourself when you are not speaking.

I would like to remind witnesses that committee members may ask questions in either French or English. If you will need interpretation, take a moment now to prepare your earpiece and select the listening channel in advance in order to take full advantage of the time allotted for questions and answers.

For members participating in person or via Zoom, please raise your hand if you wish to speak. The committee clerk and I will do our best to maintain a consolidated speaking order. All comments should be addressed through the chair.

Pursuant to Standing Order 108(2) and the motion adopted on Thursday, April 23, 2026, our committee shall resume its study of Canada's electrification, energy self-sufficiency and domestic energy security.

I would like to welcome our witnesses for today.

With us in person is Paul Cheliak—I have feeling you share the heritage of many people I represent in my area—who is the vice-president of strategy and delivery with the Canadian Gas Association.

We have Travis Balaski, president of the Inuvialuit Petroleum Corporation.

On behalf of the Inuvialuit Regional Corporation, we have Piers Kreps, director of government affairs. He joins us by video conference.

The Montreal Economic Institute is represented by Renaud Brossard, vice-president of communications, and Gabriel Giguère, senior policy analyst.

All virtual witnesses have conducted a mandatory witness onboarding test.

You will each have five minutes for your opening remarks, which I think you've been advised of, after which we will open the floor to questions.

Mr. Cheliak, you have the floor.

[Paul Cheliak, Vice-President, Strategy and Delivery, Canadian Gas Association]

Thank you, Madam Chair and all members, for the opportunity to appear today.

The Canadian Gas Association represents Canada's natural gas pipeline industry. We operate 600,000 kilometres of infrastructure, serving 20 million Canadians with energy every single day. Through this system, natural gas meets 40% of all of Canada's energy needs.

CGA and its members advocate strongly for bringing transparency to the domestic energy conversation, and we offer our support to the committee as it undertakes this ambitious study.

My remarks will focus on three areas: trends in natural gas and electricity over the last 15 years in Canada, electrification policy and the importance of peak energy use, and the need for policy clarity on domestic natural gas in Canada.

Looking at trends in Canadian energy use, we have provided a dataset as part of our package that will highlight these changes, but I'll address a few of them here today with you.

Over the last 15 years, natural gas use in Canada is up by 63%, driven by a 100% increase in industrial natural gas use. The increase in industrial gas use, for context, is 10 times the entire increase in all electricity use in Canada over the same period.

On an annual basis, electricity has increased by 0.7% and natural gas has increased by 4.2% on the consumption side. Doubling our electric system by 2050 would require an annual growth rate of 4.3% every year from 2027 to 2050, a pace six times higher than that of the last 15 years. On pricing, the price of natural gas has declined by 30% in 15 years, whereas electricity prices have increased by 1%.

As we look at policy, we highlight the many electrification programs introduced in the last decade, including electric vehicle incentives, investment tax credits, funding programs for smart grids, heat pump incentives, etc.

As you know, a lot has changed in the energy market, including a heightened focus on affordability, energy security and looming shortages of electricity in key regions of the country. As such, new programs or spending commitments must be assessed against what consumer costs will be, what electricity will be available when and where and what higher demand will do for peak energy. Policies that add electricity demand to the grid, especially for home and commercial building heating, will dramatically affect peak energy.

As you know, energy systems are designed for the top hour of the year. That's the coldest day or the hottest day. They must be able to meet peak demand during the peak hour. In Canada, that's the winter. The average home uses six times more energy in the winter than it does in the summer.

I'll provide some examples of how significant this is. In January 2025, Ontario's natural gas system delivered the equivalent of 80,000 megawatts of energy, six times the capacity of Ontario's entire nuclear fleet. In January 2024, Alberta's natural gas system delivered 110,000 megawatts of energy versus 12,000 megawatts on the electric system. In British Columbia, where temperatures are more moderate, the natural gas system at peak times delivers twice the energy of the electric system.

This is not to say that we shouldn't use electricity for heat. For example, dual fuel heating uses a natural gas furnace paired with an electric heat pump. Doing so allows the electricity to operate when temperatures are moderate, and the natural gas takes over when temperatures cool down. Dual systems mitigate significant peak energy demands. Data from B.C. shows a 70% decline in peak electric use in a home that uses dual fuel heating versus a home that simply uses an electric heat pump.

The increasing integration of gas and electricity systems points to the need for a clean federal vision for domestic natural gas in Canada. Natural gas is not just a source of fuel to create LNG for export or generate electricity, but the backbone of our industrial and heating economy, yet the domestic market is without a vision, one that will enable Canada to secure new pipeline investments to fuel AI, industrial customers, power generators and a growing population. We are smart to share this resource with the world and our allies, but we need a plan for our domestic industry.

Let me conclude with three recommendations. The first is that government review its federal electrification policies and ensure that new programs undergo a reliability test to ensure implications on reliability and peak energy are taken into consideration. The second is that government work with stakeholders to publish a national policy statement on natural gas, starting with a potential study by this committee on the role of natural gas in Canada. The third is that dual fuel heating be included as an essential component of how Canada mitigates peak energy on electric systems moving forward.

Thank you very much.

[The Vice-Chair, Conservative, Shannon Stubbs]

Thank you, Mr. Cheliak.

Now we will move to Mr. Kreps for five minutes.

[Piers Kreps, Director, Government Affairs, Inuvialuit Regional Corporation]

Ublaami, good afternoon. Quyanainni, Madam Chair, honourable committee members and Mr. Clerk for your invitation.

My name is Piers Kimiksana Kreps. I'm the director of government affairs at the Inuvialuit Regional Corporation in Inuvik. I am joined today by my colleague Travis Balaski, president of the Inuvialuit Petroleum Corporation. We are delighted to present to the committee today on the Inuvialuit energy security project.

I would like to start off by giving some background information about the Inuvialuit.

We are located in six communities across the western Canadian Arctic, with Inuvik, NWT, being our regional hub. In 1984, our people ratified the Inuvialuit Final Agreement, which established the Inuvialuit Regional Corporation. A majority of our 5,000-plus beneficiaries live in the Inuvialuit settlement region. Our modern treaty, as we call it, also established several corporations to serve distinct purposes, including the Inuvialuit Land Corporation, which holds settlement lands over which we own surface and subsurface rights, and the Inuvialuit Petroleum Corporation, which facilitates the engagement of Inuvialuit in the energy and resources sector.

The Inuvialuit settlement region has a long history of natural resource development. The Berger inquiry was established over 50 years ago to investigate the impacts of major proposed developments on and around our lands. The inquiry found that our rights must be respected and that we must have economic self-determination. Today, the Inuvialuit have determined that the Inuvialuit energy security project can deliver us economic benefits while maintaining our identity and environment.

Now I would like to pass the mic to Mr. Balaski.

[Travis Balaski, President, Inuvialuit Petroleum Corporation]

Thank you, Mr. Kreps.

Good afternoon, Madam Chair and honourable committee members.

The Inuvialuit settlement region of the western Arctic is very rich in natural resources and is one of the largest untapped oil and gas reserves in the world, as is well understood by the many decades of drilling and investigation that have occurred, yet the region pays some of the highest energy costs in Canada for both household and commercial users. It is not uncommon to see a monthly heating utility bill of well over $1,000 per month, per household. One community, Inuvik, has benefited from 25 years plus of local gas production to manage energy costs somewhat, but even that resource is now at end-of-life, and all energy needed for the Inuvialuit settlement region is now imported from southern Canada or internationally.

Fortunately, the Inuvialuit energy security project is under construction and looking to begin operations in the next couple of years. It has been a long road for the project with significant risk, led solely by the Inuvialuit, who are fortunate and visionary in their approach to regional development. By the time the IESP is operational, it will be over a decade of development and effort since inception.

The IESP—or Inuvialuit energy security project—went through several years of local studies and four years of environmental screening and Canada Energy Regulator review, finally achieving full permits to construct and operate in the first quarter of 2024. This will be a one-of-a-kind project where an indigenous proponent will own the subsurface mineral rights, the surface lands and the facilities and be the largest customer. Consultation began early in 2018, is ongoing and will continue throughout the life of the project, making sure that local concerns are adaptively managed as the IESP progresses through its various life stages.

The project involves the construction of a gas plant that will produce natural gas and synthetic fuels, which can then be transported to local customers for power, heating and transportation applications. The IESP will reduce reliance on expensive southern fuel and exposure to intermittent access. Based on the estimated reserves of the IESP resource, the project will be able to operate for 50 years plus as currently designed.

The IESP will create opportunities for local beneficiaries and mitigate the cost of living and doing business in the Inuvialuit settlement region for generations to come. The IESP has already performed over $50 million in local Inuvialuit business contracts and employs many local people and Inuvialuit beneficiaries. The project provides huge environmental benefits by reducing greenhouse gas emissions and eliminating long-distance hydrocarbon supply chains, greatly reducing the risk of hydrocarbon spills across northern Canada and our waterways.

As mentioned, the Inuvialuit have led and have spent significant risked dollars to develop a critical infrastructure project for the western Arctic. The Inuvialuit Regional Corporation continues to work with many federal departments on advertising the many benefits the IESP provides to the north and Canada, but it is still seeking clarity from several federal departments and, ultimately, further government support. The IESP aligns very well with Department of National Defence Arctic initiatives as well as the potential for major projects across the north.

Permitting is mostly in the rear-view mirror at this point, but looking forward, reducing the capital burden and cost of capital on Inuvialuit is a key priority of the project and the Inuvialuit Regional Corporation. The end price of the product is driven by the infrastructure cost to build and operate and not by typical commodity markets. This is a stranded untapped resource, and the greatest economic opportunity for the project comes by reducing the Inuvialuit financial risk to build and operate.

We thank you for your time and the opportunity to speak today, and we look forward to the questions.

[The Vice-Chair, Conservative, Shannon Stubbs]

Thank you very much.

I hope all colleagues support that I allowed him 39 extra seconds to finish the statement.

Mr. Brossard, you now have five minutes.

[Renaud Brossard, Vice-President, Communications, Montreal Economic Institute]

Thank you so much.

Good afternoon.

First, I'd like to thank you for inviting the Montreal Economic Institute to discuss a fundamental challenge for Canada's economic future, energy security. For those who aren't familiar with the institute, we are an independent think tank with offices in Montreal, Ottawa and Calgary. Through our research and media activities, we have been contributing to public policy debate in Quebec and Canada since 1998.

In the past few years, we have clearly seen the impact geopolitical upheavals have on the price of energy in the country. The invasion of Ukraine in 2022 and, more recently, the war in Iran are striking examples of that.

Whenever an event somewhere in the world threatens the energy supply, Canadians feel the effects at the pump. Farmers and business owners feel the effects in their energy bills, so products end up costing consumers more.

Canadians are not alone in seeing the price of energy jump. As markets are globalized and competition is fierce, prices follow the same trajectory all around globe. This is true despite Canada being a major producer of energy.

In this context, the best way to secure a reliable and affordable energy supply for Canadians is to allow our energy producers to help stabilize global supply. This means allowing the construction of the infrastructure that would allow them to ship the resources they produce to markets that need them. Unfortunately, over the course of the last decade, a series of policy choices have impeded our ability to secure the supply.

Our arbitrary and highly politicized project assessment process won out over any such efforts. Instead of establishing clear criteria based on mitigating risks and maximizing benefits for the country, the current process ultimately depends on whether the minister of the day wants a major project to get built or not. That's just as true for mines and pipelines as it is for routes and wind farms. The result is more uncertainty, which means less investment and fewer project proposals at the end of the day.

For example, the unfavourable decisions regarding the GNL Québec project helped to keep Canada's gas resources landlocked. For a few years, the government even claimed that there was no demand for the resources, despite our allies in Europe and Asia repeatedly asking for them. Although Canada did not answer the call then, it appears to have the opportunity now. This is Canada's opportunity.

In fact, the few projects that have been built, LNG Canada, in Kitimat, and the Trans Mountain pipeline expansion, in Burnaby, have shown the benefits these projects can have. Thanks to the deployment of that infrastructure, Canadian resources have found new markets. Our non-U.S. oil exports have risen from 3% to 14%, and 7% of our natural gas exports are not heading south of the border.

This does two things: one, provide the rest of the world with more reliable energy, which stabilizes prices here and elsewhere; and two, allow Canadian producers to get what their product is worth, which strengthens the economy. That is why a project to build a gas pipeline and liquefaction plant on the east coast, like the one Marinvest Energy wants to build in Baie-Comeau, should be prioritized.

By making it easier to transport natural gas from TC Energy's main system to the Côte‑Nord in Quebec, we can position ourselves in European markets hungry for new sources of natural gas. That demand was on display just yesterday. To secure Canada's reliable natural gas, Germany is willing to have it brought all the way from British Columbia to gas terminals on the North Sea, via the Panama Canal. It will take more than 26 days to ship the gas by boat. If that boat were leaving from Baie‑Comeau, instead of Prince Rupert, it would take just under eight days to reach the destination.

As you can imagine, a journey that long will affect transportation costs. The Germans are willing to pay those costs today because Canada provides something valuable, a stable and reliable supply of energy. Clearly, if eastern Canada had such a terminal, we could meet more of the European demand for natural gas, which would help our allies and stabilize energy prices.

There is no doubt that Canada has everything it needs to become a reliable supplier of oil and gas. We have abundant resources in an enviable geographic location, and as I said, importing countries are currently looking for new reliable suppliers. The only thing we are missing is an assessment process based on clear criteria, not the arbitrary decisions of the minister of the day. This is our best chance to build the projects Canada needs to help stabilize the world's energy supply and, by extension, ensure that Canadians have access to reliable and affordable energy.

Thank you.

[The Vice-Chair, Conservative, Shannon Stubbs]

Thank you.

I am constraining my reaction so as to act appropriately in this chair, but I appreciate your very important testimony.

We'll go to the Conservatives for the first round of questions.

For six minutes, we have Monsieur Groleau.

[Jason Groleau, Conservative, Beauce, QC]

Thank you, Madam Chair.

Thank you, fellow members, for having me today. It's my first time at the Standing Committee on Natural Resources.

Mr. Giguère and Mr. Brossard, I hope you're doing well. Thank you for being here.

Given the geopolitical instability around the world, how at risk is eastern Canada's oil and gas supply?

What would true energy self-sufficiency for our region look like?

[Renaud Brossard]

Thank you for your question.

As far as ensuring Canadian supply is concerned, we don't need to worry about shortages when we fill up. We're not going to run out of gas. What we are likely to see, however, is higher prices, and that's what we've seen over the past few months.

Even though Quebec doesn't get any oil from Iran or the area around the Strait of Hormuz, we've basically seen the price of oil skyrocket. The reason is simple. It's a global marketplace. Whether the oil is sold to Quebec, Asia or Europe, the resource is the same and so is the price. As I said in my remarks, the best way to secure both a reliable and affordable supply—a key component of energy security—is to help stabilize global demand.

Right now, a lot of our infrastructure moves resources westward. With that infrastructure, we can help stabilize markets in Asia somewhat. Unfortunately, we have little in the way of infrastructure that can move product eastward, so we can't help stabilize markets in Europe.

[Jason Groleau, Conservative, Beauce, QC]

With Quebec putting a lot of eggs in the electricity basket, why do you think the all-electric transition, without a local oil or gas safety net, puts the province's energy resilience at risk?

[Gabriel Giguère, Senior Policy Analyst, Montreal Economic Institute]

Thank you for your question.

Basically, what we see is that Quebec is moving towards total electrification, away from a dynamic where it has surplus electricity. That is crystal clear and illustrates the importance of keeping natural gas in Quebec's energy mix.

I'd like to add to what my colleague said. In the current context, people understand the importance of having energy infrastructure in Canada and in Quebec. Quebec can't make the same mistake it made with GNL Québec in 2021, when it told people that there wouldn't be any demand. We can clearly see that there is. The Germans showed us that yesterday. Projects on the table today like the Marinvest Energy Canada development could go ahead, but a predictable regulatory framework is needed. Certainty is needed.

Whether we're talking about Canada, or even Quebec somewhat, that regulatory framework is missing.

[Renaud Brossard]

I would add that electricity is a major energy source for Quebec. However, most of its energy still comes from oil and gas, which represents 55% of Quebec's energy consumption. You can't replace that overnight.

Without a reliable, affordable supply of oil and gas, Quebec won't be able to meet 55% of its energy needs. It's an integral part of Quebec's energy security.

[Jason Groleau, Conservative, Beauce, QC]

According to the institute's research, how would lifting the ban on oil and gas exploration affect the province's GDP and regional employment, in practical terms?

[Gabriel Giguère]

That's an extremely important aspect. When we did our analysis, we focused on natural gas. We found that just the development and exploration of Quebec's natural gas resources could add $93 billion to GDP over the next 25 years. That really highlights how significant the energy sector is in Quebec.

Quebec needs to be able to develop those resources, not only because it would increase GDP and government revenues by up to $15 billion, but also because it would generate thousands of paid jobs. That is huge. Statistics Canada data shows that, the average oil and gas worker earned $155,000 in 2024, not $40,000. That makes a difference for Quebec families.

[Jason Groleau, Conservative, Beauce, QC]

You talked about infrastructure and a gas terminal in eastern Canada.

Why isn't the project going ahead? What's keeping it from seeing the light of day?

[Gabriel Giguère]

I think it's partly to do with the regulatory framework. We see that today with Bill C‑69. The rules are very complex. The federal regulatory framework is a duplication of Quebec's regime. The combination of both regimes makes the process very complex. It'll be important to reform the current regulatory framework to get rid of any duplication and recognize the province's impact assessment process. The federal process needs to be short and tailored.

It's pretty clear that we need a new regulatory framework.

[Renaud Brossard]

Part of the problem is how arbitrary the federal piece is. In many cases, investors decide not to proceed even before the project is brought forward. Why? Simple. The minister of the day decides whether the environmental impact assessment is valid and whether the project should go ahead or not.

When the criteria are that arbitrary, it makes undertaking a project risky. When investors look at where they should put their money, they aren't keen on building a pipeline in Quebec or Canada. What they want is to be able to invest in a pipeline project that will be profitable. Because of the uncertain and arbitrary nature of the federal government's involvement, those projects are riskier and unfortunately less appealing from an economic standpoint.

In a nutshell, the government has regulated these projects out of existence [Technical difficulty—Editor].

[Jason Groleau, Conservative, Beauce, QC]

Thank you.

[The Vice-Chair, Conservative, Shannon Stubbs]

Thank you. That completes a very informative round.

Now we'll move over to the Liberal Party with our movie star MP. Virtually, he's in a magnificent place.

For six minutes, you have the floor, Monsieur St-Pierre.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

Thank you. I'm calling from home. My wife owns a bookstore and is a big reader.

Mr. Brossard and Mr. Giguère, it's a pleasure to see you again.

I sincerely hope the Montreal Economic Institute is soon going to put out a report showing that the Habs are the best hockey team. Go, Habs, go!

That was for my colleague Mr. Guay.

In all seriousness, how, in your view, can the federal government accelerate the development of clean energy projects across the country?

[Renaud Brossard]

Thank you for your question.

Regarding hockey, a lot of this morning's reports talk about how we can have a better hockey team.

Turning back to energy, I would say there are things the federal government can do. I must admit, the government has announced some good things recently. It wants to review and fast-track the impact assessment process. We're very eager to see what that legislation looks like.

We want to see the government walk the talk. What we've heard so far sounds great. Whether it's clean energy technology, a mine or a pipeline, accelerating a project's development comes down to the same thing. They all have to go through the same assessment process. The federal Impact Assessment Act applies to offshore wind development projects in Newfoundland and Nova Scotia, mining projects in Ontario and interprovincial pipeline projects.

Something the government can do is review the criteria. One of the problems we've seen with the Impact Assessment Act is that it tries to do too much all at once. When you try to do everything well, you end up getting everything wrong, unfortunately.

That's more or less what we've seen with the tool. The time frames also need to be shortened. The recently proposed 12-month timeline is a big step in the right direction.

Ideally, the government would also get rid of the arbitrary elements in the act. One of our problems with the Impact Assessment Act is that the minister can intervene and put the process on hold at any time, resulting in a much longer process than initially set out in the act.

[Eric St-Pierre, Liberal, Honoré-Mercier, QC]

Thank you.

To Mr. Kreps or Mr. Balaski, I believe the IRC conducted a residential winterization blitz to help implement energy efficiency, with an insulation initiative that cut energy costs. Can you tell me a bit more about how this type of energy efficiency initiative helps reduce dependence on external energy and how that helps sovereignty?